The BIC is a statistic
A)commonly used to test for serial correlation
B)only used in cross-sectional analysis
C)developed by the Bank of England in its river of blood analysis
D)used to help the researcher choose the number of lags in an autoregression

Question

Quizplus · Accepted Answer

The BIC (Bayesian information criterion) is commonly used in time series analysis to help the researcher choose the appropriate number of lags in an autoregression. It is a criterion that balances model fit (measured by the likelihood function) with the complexity of the model (measured by the number of parameters). It is not used to test for serial correlation, is not limited to cross-sectional analysis, and was not developed by the Bank of England in its river of blood analysis.

The BIC Is a Statistic